The world of real estate investment changes continuously. If you want to make good decisions about investment properties, you need to know what’s happening and what the changes mean for how you develop your marketing efforts.
Last year was more tumultuous than usual. Large-scale global events significantly altered the property market. to help you catch up, this short real estate marketing guide will attempt to answer some of the most critical questions for the year to come:
What’s changing in real estate?
What tools being used to attract property buyers?
What forms of marketing stand out for real estate marketing?
What’s likely to change next year?
Let’s start by looking at the real estate market itself.
What’s changing in real estate?
The property market can turn on a dime. That’s why we can’t consider marketing trends without looking at the trends of the market itself. These fast-moving trends should play a major role in the property you choose for investment.
Several trends in the market over the last year may have an outsize impact on the residential property market. Below, we’ll explore increasing demands for floor space, the rise of housing prices, and the drift toward rural homes.
Demand for floor space is growing
The median size of family homes has declined somewhat since a peak in 2015. This was in response to a declining interest in larger homes. At least until recently, experts expected that decline to continue.
However, everything changed with the global lockdown. For entirely new reasons, interest in larger homes increased. Now that more people are working from home, separate office space is a necessity.
Will that trend continue? Recent evidence suggests that it will. Multiple major companies have already announced that they will be keeping their workers remote for the long-term. That means home offices will likely be in-demand for the foreseeable future.
The implications for your investing decisions are clear. You need to consider the value of space. It may even be to your benefit to begin considering to extra bedrooms as offices in advertising.
Housing prices are continuing to spike
As they have for many years now, housing prices rose through 2020. This trend does not seem likely to slow down anytime soon. We are still waiting to see the full effect that the lockdown had on new home construction, but many projects were delayed. This may result in an even tighter housing supply than we have seen so far.
The rising prices may have several implications for your real estate investing and marketing. For example, the average homebuyer may be more affluent than in the past, and the average seller may be holding out for a better deal. This may affect how you target your audience and what type of marketing is effective.
Home buyers are moving back to the suburbs
Over the last few decades, the cost of homes in urban areas has significantly increased. Millennials and other demographics showed a clear preference for the opportunities offered by cities.
Cities like New York, Los Angeles, Boston, and Seattle saw prices that shattered records and homes that doubled or tripled in value over less than 20 years. Now, there’s evidence that the wave may be breaking.
When the lockdown happened, many people left the cities—fearing the dangers of close contact—for suburban and rural areas. Many of them discovered that the internet still kept them connected to career opportunities in the city.
The fact that Millennials are now settling down with families is also likely to drive this trend in the future.
This trend may have strong implications for both your advertising and properties that you prefer for investment. There is likely a higher demand for rural homes in the future, and young people may drive that demand.
What tools are being used to attract property buyers?
New technology and tools have resulted in revolutionary innovations in the way people explore properties. Nearly all of these innovations result from a growing desire to complete most steps of the property-searching process without ever meeting in person.
People are finding properties, fully exploring them, and evaluating the features without ever speaking to a realtor. The fact that they are making judgments of their own rather than having the value “sold” to them may make them more confident when closing.
The necessity of social distancing has expanded these innovations to the entire market. Now that many people have bought and sold houses this way, the changes are likely to be permanent.
Below, we’ll explore the expanding capabilities of virtual open-houses, drones, and automation.
Virtual tours have been a part of home listings for several years. They have not always been helpful or user-friendly. However, as standard home internet connections and video technology have improved, these tours have become smooth and lifelike.
Today, virtual tours are a major feature of massive real estate marketplaces like Zillow. During the lockdown, many homebuyers experimented with buying properties unseen based on the quality of the tours.
At least some of the people who became comfortable with this practice are likely to continue doing it in the future. Great virtual tours are also likely to become a basic expectation rather than a nice extra.
If you want to keep your marketing up-to-date, you should outfit all of your property listings with a virtual tour.
Drone technology has dramatically improved in quality over the past several years. It was only a matter of time before they started to make their mark on real estate.
Drones are now being utilized to perform aerial surveys of properties. They are used to verify the integrity of features like the roof. They are also used to take high-quality images of:
Land features including ponds, bluffs, and groves
The surrounding town
Ariel photographs are most often used for high-end homes, particularly those that are too large to photograph easily from the ground. They’re also helpful for capturing the full glory of multi-acre properties.
This trend may have implications for your marketing and investing efforts. Look for aerial photos of any properties you buy. As prices for drone fly-overs decrease, more property sellers will employ this tactic—making those who don’t stand out.
Real estate deal automation
Automation has been a growing trend in the real estate business for several years. Massive platforms like Zillow and Trulia have already taken over the property searching stage of buying a home. What’s being automated now is transactions.
Transaction automation is rapidly spreading through real estate. E-signatures, E-recording, and E-notarization were already spreading before the lockdown. After the lockdown, nearly every company involved with real estate was rushing to put these systems into place.
This isn’t likely to have a direct effect on how real estate investors market their properties. However, the indirect effects may be worth noting. These innovations remove a significant amount of the waiting and costs that relate to closing.
It may be possible to use the savings to create more incentives to motivate sellers or to just cut the cost of buying your investment properties in general.
What’s likely to change this year?
Now that we’ve covered some of the most important changes that we can track let’s take a minute to consider what might be coming down the road.
Real estate has always been a fast-moving market, but the changes we’ve already discussed point to faster and more severe changes in the future. Based on what we know, here are some possibilities:
Internet connectivity is only getting better and more widespread. That may mean that the market moving to the countryside will be a permanent trend. Cities may contract as fewer people need to be present to have access to competitive careers.
As high prices push more people out of the market, the likelihood of legislative action increases. Real estate investors should be prepared for relief programs that cause rapid changes in the market.
Participants in a sale will continue to expect convenience throughout the process. You should expect major real estate platforms to continue to invest in features that make listings more automated, attractive, and complete. If you’re on these systems, that’s great news. If you’re trying to compete with them by attracting leads to your own sites, it may mean high costs for you.
Be ready for the latest trends in real estate
Hopefully, this real estate marketing and investing guide has prepared you for some of the big changes that are coming in 2021. You’ll likely need to change many of the ways that you reach motivated sellers. Make sure you start getting ready by preparing for new expectations.
The market is moving to open spaces and a lot of property. Properties are likely to be more expensive in general. Everyone will expect the process of buying to be slick, and automated.